Planning a funeral may become a simpler and more transparent process under a potential rule change that would require the industry to disclose all their prices and services online, thanks to recent efforts by the Federal Trade Commission.
The FTC voted 4-0 in October to consider changes and seek public comments about the “funeral rule” to require online price lists.
Other changes could include clarifying that consumers have a right to decline embalming, and requiring funeral homes to fully disclose all cremation costs, including costs from third-party crematories. The comment period on the potential changes ends Jan. 3. To provide comment, visit the FTC’s website.
“When a loved one dies, grieving family members and friends often must make difficult decisions about funeral arrangements in a very short time frame and under great emotional stress,” the FTC said in a report. “To complicate things, many people find themselves searching for funeral providers and making arrangements from a distance, without visiting the funeral home. With the median cost of the average funeral reaching almost $8,000, making funeral arrangements is a significant financial decision.”
“ ‘It’s OK that some prices are higher than others. Some people want a Porsche. Some want a Hyundai. Funeral consumers are not price-sensitive.’”
— Christopher Farmer, general counsel for the National Funeral Directors Association
The original funeral rule, which became effective in 1984, and was amended in 1994, predates broad consumer use of the internet and does not specify that prices and services must be disclosed online. The rule currently only requires price disclosure when a consumer visits or telephones a funeral home.
“People are at their most vulnerable when they’re grieving,” said FTC Chair Lina Khan said in a statement. The potential changes could “help consumers make informed decisions during some of the most difficult moments of their lives. It could also better incentivize funeral homes to offer the most competitive prices. This would ultimately lower the expensive burden of putting a loved one to rest.”
“ ‘This is one of the largest purchases in a lifetime. We want better transparency and accountability.’ ”
— Sara Valentine, incoming president of the Funeral Consumers Alliance of Maine
The so-called funeral rule, formally known as the Trade Regulation Rule Concerning Funeral Industry Practices, was originally enacted to lower barriers to price competition in the funeral goods and services market, and to help inform consumer choice.
The rule requires that consumers have access to enough information to make informed decisions and that consumers are not required to purchase goods and services that they do not want such as bundled packages of services or services not required by law.
For example, a funeral provider must show a casket price list when someone asks in-person about those items or their prices, and before showing the items or pictures of them. It also requires funeral homes to provide information about the services and prices over the phone.
Because it was enacted about four decades ago, the funeral rule does not mention the internet or any electronic communication and includes no explicit requirements to disclose their services and prices online or through email.
“This is about the age we live in — the digital age. People often need to make fast decisions when someone dies unexpectedly. They are at a vulnerable time. They need easy access to information and have the most complete information available,” said Sara Valentine, incoming president of the Funeral Consumers Alliance of Maine, a consumer advocacy group. “This is one of the largest purchases in a lifetime. We want better transparency and accountability.”
According to an FTC staff review, 61% of funeral websites reviewed did not provide any price information. Of those websites that provided pricing, only 11% provided only starting prices or package offers and 4% contained information only about prices for caskets or alternative containers. Only 24% of websites contained an itemized price list.
“In most instances people viewing these websites would have a difficult time determining what prices were charged by a provider or comparing prices between providers. Most of the providers did not include any price information and those that did offer such information typically provided only partial information,” the FTC staff review said. “Consumers planning funerals would, in almost all instances, need to contact the businesses directly or visit the providers in person to get enough information to make informed price decisions or to compare prices.”
The FTC found that the prices varied widely, with the lowest price for direct cremation starting at $595 and the highest at $4,760, excluding the cost of an alternative container. Some of the websites listed fees and items included in package prices such as the cost for transportation, crematory fees, and death certificates, but others did not, the agency found.
The funeral industry opposes the potential rule change.
“We’re 100% in favor of transparency,” said Christopher Farmer, general counsel for the National Funeral Directors Association. “But we do not believe a rigid federal rule is the way to accomplish this.”
Farmer said some states, such as California and Oregon, already have some measures that are similar to the FTC’s proposed changes. States are more nimble in creating and updating such laws as needed than the federal government, Farmer said.
Requiring online pricing would be onerous for the industry and unnecessary for the vast majority of consumers, who tend not to comparison-shop multiple funeral homes, Farmer said.
According to the NFDA’s annual funeral consumer surveys from 2012 to 2020, the composite results from the nine annual surveys found that 80.7% of consumers contacted only one funeral home, and only 17% of consumers contacted two or more.
“This is a very relationship-based, old fashioned industry. It’s not technologically advanced. I know some funeral homes that don’t use computers,” Farmer said. “It’s OK that some prices are higher than others. Some people want a Porsche. Some want a Hyundai. Funeral consumers are not price-sensitive.”